The Commercial Rents Tax (also referred to as the Early Care and Education Commercial Rents Tax) generally applies to businesses leasing commercial space in the City and generally does not apply to businesses exempt from Gross Receipts and Payroll Expense Taxes. In addition to the existing Gross Receipts and Payroll Expense Taxes, this measure imposes a new gross receipts tax of:
- 1% on the amounts a business receives from the lease or sublease of warehouse space in the City;
- 3.5% on the amounts a business receives from the lease or sublease of other commercial spaces in the City.
This tax is filed as part of the annual business tax return.
Commercial space is any building or structure, or portion of a building or structure, that is not residential real estate, as defined in section 954.1 of Article 12-A-1. For the purposes of this tax, commercial space does not include any building or structure, or portion of a building or structure, that is used for:
- Industrial Use, as defined in Section 102 of the Planning Code
- Arts Activities, as defined in Section 102 of the Planning Code
- Retail Sales or Service Activities or Retail Sales or Service Establishments that are not Formula Retail uses as defined in Sections 303.1(b) and 303.1(c) of the Planning Code
- (Updated 4/29/19) Tax Collector Regulation 2019-2: Early Care and Education Commercial Rents Tax Regulation (Costs Passed On To Tenants Under Lease)
- Commercial Rents Tax Credit and Exclusions: Credit for child care facilities. Exclusion of rents subject to hotel tax or parking tax.
- Statement by Treasurer Cisneros about taxes passed by the voters in the 2018 elections.
- Article 21: Early Care and Education Commercial Rents Tax Ordinance
- San Francisco Business and Tax Regulations Code Sections 6.9-1 through 6.9-5 of Article 6 for additional information on Determinations, Returns and Payments.
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